Bank should share blame, says trader

One of four National Australia Bank employees suspended after allegations over a $180 million currency trading scandal has claimed the bank "sensationalised" claims of rogue trading to shore up its reputation.

David Bullen yesterday said from his East Malvern home that he accepted responsibility for his part in the $180 million loss and that the bank was pushing its own, politically motivated line to protect its corporate status.

"I accept my responsibility in the matter and the bank may or may not be without blame," he said. Mr Bullen reiterated claims that the bank had either known or tolerated breaches of trading limits. He said that for the past four months, risk limits affecting the trading desk had been in excess of what the bank had stipulated.

The bank refused to respond to his comments, citing potential legal action against the suspended traders.

The NAB has said the trades leading to the loss were unauthorised and took place after September 30, 2003, when its reporting year ends. Any breaches before then may force the bank to recalculate its 2003 financial accounts, which state it made a $3.9 billion net profit.

"If we do (comment), we are at risk of pre-empting any legal action and that is just not prudent to do so," said bank spokesman Robert Hadler.

Meanwhile shareholders and analysts are concerned that no one from the bank's board or management has taken responsibility for a string of mishaps that have plagued the NAB under chief executive Frank Cicutto.

The mishaps, which include the $4 billion write-down of the US-based mortgage business HomeSide, various profit downgrades and the misjudged share raid on AMP, have steadily undermined confidence and affected the bank's share price, an analyst says.

"The board and management have been able to deflect blame and responsibility for these things up until now," said Shawn Burns, of Deutsche Asset Management.

"Some people are asking, 'When does the buck stop with the chief executive and the board?' "

It was a sentiment echoed by major shareholder Argo Investments, which owns $95 million worth of shares in the bank.

"Certainly (Frank Cicutto) stands tall among the other bank CEOs in terms of presiding over a few stuff-ups," Argo managing director Rob Patterson said. "I have to say, how many of these things can he preside over?"

The four traders have been identified as Mr Bullen, Luke Duffy, Vince Ficarra and London-based Gianni Gray.

Mr Bullen said yesterday he did not know whether he had broken the law but was prepared to accept the consequences.

He said senior NAB officials had quizzed him all day on Tuesday about his involvement in the trades but had not contacted him since. He had been suspended on full pay but did not expect to return to work. He said he had not sought legal advice.

The Australian Federal Police is investigating whether the trades breached the law. The bank has instituted its own investigation, which includes a team from accountants PricewaterhouseCoopers.

Asked whether the trades had been authorised by bank officials, Mr Bullen said he could not speak about the transactions or name any individuals involved.

The Australian Prudential Regulation Authority is investigating the bank's risk-management controls, while the Australian Securities and Investments Commission is still considering whether to investigate.